TownePlace Suites by Marriott Breaks Ground in Marion

By Jon Musgrave

MARION—A new $10 million TowneSpace Suites by Marriott on Halfway Road in Marion is expected to begin construction later this month, according to the developer Neal Patel of Carbondale. 

Sitework began on the last day of August, and final construction plans will be submitted to the city in the next week or so. 

The new 77-unit hotel will be located just south of the old demolished Limited Inn on Halfway Road at the intersection of Walton Way. Each suite will be a studio apartment featuring full-size kitchens and in-room workstations. 

“We needed something on this side,” Patel said in regard to the south side of Illinois Route 13. The new four-story hotel will add some height. 

Walton Way and its extension, Joseph Cannon Way, has seen a number of new projects over the last few years, including a new Olive Gardens, which is expected to open later this year. A new retail shopping center is planned for the property west of Sam’s Club as part of the new STAR Bonds initiative, which will also include the old Illinois Centre Mall. 

“I would love to see Southern Illinois grow and grow. We’ve got our footing here, and we’re planning to stay,” Patel added. 

Once construction on the hotel begins, Patel estimates it will take 15 months, with an opening set for late October or November 2024. 

Though occupancy rates at area motels suffered during the government-imposed COVID-19 shutdowns, they recovered to around 50 percent last year and have shot up to 69 to 70 percent so far this year in Marion, according to Patel and city officials.

The TownePlace Suites may not be the only new lodging coming to Marion. The feasibility study for the STAR Bonds district includes two more hotel projects that are expected to open in 2025. 

The new hotel sits on a 1.54-acre tract. The old hotel site to the north contains 1.32 acres. “We do have plans,” for that tract, Patel said, just nothing ready to announce. 

Patel also operates the Comfort Inn in Carbondale and in Marion, the Super 8 motel, and the Marion Center on the site of the old America’s Best Inn motel anchored by Freddy’s Frozen Custard & Steakburgers. 

The new hotel replaces the 81-unit Limited Inn torn down four years ago in October 2019. It originally opened as a Regal 8 Inn in February 1974, Marion’s second hotel west of Interstate 57. The original owners were Don Geary of Centralia, James R. Bracy, and W. T. Bracy of Herrin. For most of its 45-year history, it operated under the Motel 6 franchise.

New Hotel Aims for Downtown Carbondale

Construction of a new 85 unit, 4 or 5 story Home2 Suites hotel in downtown Carbondale could take place by the end of the year.

The hotel will be located on just under an acre of vacant property on the north side of Elm Street stretching from Illinois to University Avenues. About 60 percent of the rooms will be extended stay suites and developers plan a coffee shop on the ground floor as well. Today's Southern Illinoisan has the story. This story the day before provides a bit more information.

The Carbondale City Council approved the sale of the .9617 acre lot to Sai Krishna LLC of Carbondale last night. Closing is to take place within 30 days and be "substantially" complete within 18 months.

The council sold the property at a bargain price of $75,000 which is just $1.79/sq. ft., significantly less than commercial property on the eastern outskirts of the city. However securing a quality hotel in the heart of the city has long been a part of the community leader's plans for decades and even predate the current city hall structure.

The land includes a parking lot, a vacant lot and a half-block city alley. It's immediately south of PK's bar in the 200 block of South Illinois Avenue.



An earlier story quoted city officials on the demand for a hotel.

Carbondale Assistant City Manager Gary Williams said the city had a hotel feasibility study performed in 2013 and found that it would be a favorable and economically feasible project.

Williams said when the project was complete, the city garnered interest immediately. He said the location on West Elm between University and Illinois avenues is a solid location.

“It is positioned a little over a half mile from SIU and it is less than that from SIH,” he said. “Those are two of the biggest demand generators in our region.

At Tuesday's council meeting Curtis Conley, who is both manager of PK's and president of the Carbondale Music Coalition, strongly supported the hotel. Ditto for Southern Illinois Healthcare President Rex Budde who said the development would benefit the hospital.

The development company Sai Krishna LLC registered with the Secretary of State's office earlier this year on March 6. The state lists Pradeep Reddy of Carbondale and Naresh Patel of Harrisburg as managers with Reddy also serving as the LLC's agent of record.

A few years ago Reedy and his wife donated three acres of land for the region's first Hindu temple at 1209 E. Walnut St. and has served as president of Hindu Temple and Cultural Society of Southern Illinois. Patel operates the Comfort Inn and Super 8 hotels in Harrisburg.

The new lodging development comes after a rash of much needed older hotel/motel demolitions in Jackson County.

The old Best Inns of America motel, last operating as the Unicity Inn east of the University Mall has recently made way for a new IHOP restaurant that broke ground in April. Developers paid $875,000 for the tract which will also include, "3,000 square feet for another “fast-casual” themed restaurant and 10,000 square feet of retail."

The city is also working on demolishing the former Horizon Inn, originally the city's first Holiday Inn, on Main Street. The city took ownership of the three parcels for around $2,000 and is looking for a develop who will demolish the building and redevelop the land.

In Murphysboro, the Southern Illinoisan reported yesterday that the Apple Tree Inn at the intersection of Routes 13 and 127 in Murphysboro has a new owner. The motel closed earlier June 1 following a foreclosure sale earlier in the day by the Jackson County Circuit Clerk. Joe Koppeis of Columbia, won the auction with a bid of $125,000.

Koppeis is the owner of the Holiday Inn in Sparta, the real estate company Admiral Parkway Inc., four shopping centers, hardware stores and a Domino’s franchise throughout Southern Illinois.

Murphysboro Mayor Will Stephens said he has been in contact with Koppeis, but knows there aren’t any concrete plans. He said Koppeis is commissioning a few studies to determine what would be the most feasible for the location.

Although Stephens is in the dark about what may be coming, he said the developer does have plans to demolish the building.

IHOP Expanding at Least Twice in Southern Illinois

Pancake Holdings, LLC, of Chino Hills, Cal., an IHOP franchisee hasn't announced their expansion plans yet in the region, but we now know where two of their new restaurants will be locating.

Marion Mayor Robert L. Butler announced the Marion location last Jan. 17 at the Marion Chamber of Commerce annual dinner, which he later confirmed to WSIL-TV. Developers of The Hill, Marion Heights LLC, also confirmed the Marion location as the empty lot on The Hill immediately east of Holiday Inn Express.

The lot's bounded by Blue Heron Drive on the north (from which it will have access), Morgan Avenue, now The Hill Way, on the south, the existing Miners Drive on the east (going towards Menards) and a new access road on the west connecting The Hill Way with Blue Heron Drive that's now under construction.

The site's been connected with rumored restaurants for the last few years, including Olive Gardens at one point, but this is the first time a restaurant has been publicly announced. It follows the announcement late last year of a new Gander Mountain opening behind Menards.

Molly Parker of the this morning's Southern Illinoisan has the story on the new Carbondale location IHOP is eying.

Both Gary Williams, Carbondale's assistant city manager for economic development, and Hiren Patel whose MK Lodging LLC owns the UniCity Inn, confirmed that the troubled motel property will be torn down and replaced not only with an IHOP, but a second "3,000 square feet of space for another 'fast-casual' themed restaurant and 10,000 square feet of retail." Patel said he finalized the deal Thursday.

Patel's company bought the former America's Best Inn next to Steak 'n Shake last February after it had been closed by the city for code violations. Although he invested thousands into it to reopen and re-brand it, he said after a month of contemplating, the best business decision was to sell rather than pour thousands more into it.

Although deals have supposedly been reached for both parcels no deeds have been filed as of yet. If Patel just signed the purchase agreement Thursday, it would still take a few more weeks for deeds to be prepared, signed and filed. Even with signed deeds it still takes time. When Gander Mountain bought its property last Nov. 13, they didn't file the deeds and other documents for three weeks until Dec. 5.

Up until last fall the nearest IHOP restaurants were in the St. Louis area and Paducah, Ky. A new franchisee, Apple Investor Group, opened an IHOP in Cape Girardeau last October in the former Pasta House restaurant that closed last May.

The new Carbondale, and most likely Marion IHOPs will be new construction and will be among the first to feature the chain's new restaurant design.

Butler told Parker that as far as he’s aware, “there’s not been any change” in the Marion plans. “They told me they were looking at several locations in Southern Illinois.”

Patel's MK Lodging also owns the Comfort Suites in Marion.

Rend Lake Resort Upgrades Rooms

Today's Southern Illinoisan reports on the $400,000 renovation of the Rend Lake Resort and Conference Center at Wayne Fitzgerald State Park.

Over the past two years, every guest room on the property, including those in The Flagship, Windjammer and Schooner botels, cabins and the hotel, was remodeled as were public areas like lobbies.

“It’s like coming into a brand new place,” resort concessionaire John Reilly said. “The rooms have been completely redone.”

The resort’s 105 guest rooms have new beds, mattresses, box springs, linens, lighting and drapes and are equipped with flat screen televisions, microwaves, coffeemakers and small refrigerators.

The resort opened in 1990 and the renovation should restore the luster of the lakeside facility and conference center. Now if the underfunded Department of Natural Resources would just try to focus on their own maintenance and upkeep at the park, all would be well.

Mount Vernon Makes Progress

Drury Inn & Suites (under construction - August 2013)


The new 180-room Drury Inn & Suites continues to take shape in Mount Vernon at the interchange of Interstates 57/64 and Illinois Rt. 13. When complete the hotel will also include 3,000 sq. ft. of flexible meeting space.

The project started in March and replaces a previous Drury Inn and Thrifty Inn on the north side of the highway at 44th Street.

The project also included demolition of the shuttered Best Western (originally built as the Ramada Inn, more than decades earlier). No word yet on what new restaurants or retailers Drury has promised to bring to their development. That northeast quadrant of the interchange also includes Steak 'n Shake, Dale's Harley-Davidson and GenKota Winery.

Down the highway to the east the owners of the Times Square Mall are aggressively seeking new tenants and replacements for Sears. The mall, which first opened in 1974, is currently owned by Pine Tree Commercial Realty, LLC, of Northbrook, St. Louis-based Sansone Group and Elgin-based Wanxiang America Real Estate Group.

Last week the owners announced Hobby Lobby had signed a lease for 52,729 sq. ft. in what had formerly occupied by Sears.

"Kicking off with Hobby Lobby puts our leasing of the soon-to-be-vacant areas of the center in fast gear," said Pine Tree Ex. Vice-President Bruce Boruszak who promised announcements of "additional major new leases in coming weeks."

Meanwhile work continues on the widening and rebuild of Interstates 57/64. As of June 3, IDOT esimated the work at 68 percent complete with completion expected by Dec. 1 this year.

The project includes adding a third lane in both directions "to mitigate traffic congestion... The work consists of new continusouly reinforced concrete pavement, earthwork to build the new lanes and correct slope deficiencies, culvert extensions, guardrail upgrades, pipe underdrains, patching and bridge deck repairs."

The project is the first step in the eventual six-laning of Interstate 57 from its intersection with Interstate 24 south of Marion north to where I-57 and 64 split north of Mount Vernon.

A second phase of the additional lanes also started this summer between Marion and Johnston City.

New Hotels For Marion, Mount Vernon

With the Drury chain focusing on a major new project in Mount Vernon the company took the rare step of actually placing some of their undeveloped acreage for sale. The chain has long been known for sitting on property until the time is right for development.

Recently in Marion, they turned over part of their land for the new Panera's and was in negotiation with America's Best Inns to buy and demolish that property for another well-known chain restaurant. That deal did not materialize.

Now they've placed three acres up for sale located behind their hotel and Panera's that fronts 17th Street (Morgan Ave.), and it looks like there's another developer eyeing it for a new hotel and apartments that would cater to professionals and workers who need longer-term stays.

As of last week no building permits had been issued with the city.

Drury's three acres would make a good fit for such a development. There are nine restuarants in that block or just across the streets that surround it, as well as a liquor store. Gold's Gym is just a short walk away as is Rent One Park up on The Hill.

Meanwhile work progresses in Mount Vernon for Drury Inn's new $22 million development on the northeast side of the main interstate interchange. Drury has knocked down its long-time three-story inn, a gas station next door, and as of late last month when the picture below was taken, was in the process of knocking down the Thrifty Inn and the former Best Western Inn, which had been closed for years.

The old rooms wiped out will be replaced by a seven-story hotel similar to the built in the last few years at O'Fallon, Illinois. In addition the company will create space for two new restuarants yet to be publicly identified. Plans also call for additional retail space as well.

The old Best Western hotel was one of the two original major hotels in Mount Vernon after the opening of Interstate 57. Ralph Gray, brother of U.S. Rep. Ken Gray, and developer of the Gray Plaza motel chain, built the hotel in 1967-68 as a 101-room Ramada Inn.

Gray announced the $1.1 million project at the time he opened his new Ramada Inn in Marion. Both hotels were designed to be identical. While the Mount Vernon languished in recent decades hidden behind a row of pine trees planted on the Thrifty Inn property, the Marion hotel has survived as a budget motel under a variety of franchises.

The hotels originally included a cocktail lounge, coffee shop and a banquet room large enough for 150 people. An ornate curved staircase to the a second floor was a major feature in the lobbies. Each guest room included "piped-in-music, color television and air conditioning" and were "decorated in three color schemes, gold, green and blue," according to an article in the July 23, 1967, edition of the Southern Illinoisan.

Fracking Cuts Unemployment to 0.7 Percent

Oil gusher at Robinson,
Illinois, in 1907.

The Chicago Tribune had a front page feature story Sunday about the oil boom in North Dakota which mentioned, fairly high up in the story, the potential in Southern Illinois.

There's been a lot of debate, most of it one-sided and hysterical, about the negative impacts of fracking, usually from people who don't realize our state's oil industry has been using the technique since the 1950s.

What's new is the combination of fracking, far deeper drilling as well as the development of horizontal drilling. I did a series of articles last year for The Daily Register in Harrisburg about the potential.

Those opposed to it certainly haven't swayed me. It would be better if some of their leading spokespeople weren't opposed to our petroleum-based civilization in the first place. I get it. You don't like oil. Go back to your cave. There aren't any real alternatives except for coal and natural gas which for the former you like even less.

My favorite complaint is that it would hurt tourism. In actuality, only to the extent that it would drive up room rates and eliminate vacancies. Neither of those, mind you, would bother hotel operators.

But the best reason to support a resurgence in our oil industry is the jobs that come with it. There's a story in today's paper about Illinois fighting with Iowa over a $1.2 billion new anhydrous ammonia plant.

That's a lot of construction jobs but only 150 permanent jobs when it's built. They're talking 50,000 jobs if downstate Illinois starts to do its best imitation of North Dakota.

I knew it was serious last spring when U.S. Sen. Dick Durbin, D-Illinois, came to Harrisburg for a photo op following the Leap Day Tornado. A week earlier he had targeted the coal industry at a global warming news conference in Chicago.

I wanted to ask him about his comments. To his credit he didn't change them even though he was in the heart of coal country. He surprised me when he brought up oil and natural gas as replacements for the mining jobs.

I had been hearing about the possibilities of fracking coming to Illinois and a potential oil boom. I asked, "how big?" He wouldn't quantify an answer, but smiled, and made reference to North Dakota. It was around that time that North Dakota passed Alaska as the county's second largest oil-producing state.

And with that reference it's time to get back to Sunday's focus story.

Appropriately, the Trib's big story starts with a little one, how Andy Turco went from high school dropout in a series of dead-end jobs to a solid blue collar career. All he had to do was leave Chicago for the northern plains.

Then [Turco] talked to a buddy working here, in a barren corner of North Dakota, where an ugly-sounding word — fracking — has driven oil from the ground and pushed unemployment down to 0.7 percent. That's right: seven-tenths of one percent.

Turco sold his car, hopped in a van and drove west.

Today, he's earning nearly six figures working about 90 hours a week on a drilling rig, one of many Chicago-area transplants who have joined thousands in a remote region experiencing an oil boom while much of the country tries to shake off a recession hangover.

"It is the best thing I ever did; no doubt about it," said Turco, 24, who arrived in Williston in October 2011. "I'm finally living an adult lifestyle, instead of a teenage dropout lifestyle."

And it's all thanks to fracking, short for hydraulic fracturing, a relatively new and controversial drilling technology in which highly pressurized water, sand and other substances are driven into oil-rich shale thousands of feet deep, creating cracks that release the oil deposits and send them up the well.

Read more about the developments here.

The Illinois General Assembly will be taking up state Rep. John Bradley's bill to regulate fracking. It will be the toughest regulatory oversight in the country. It's backed by both industry and the still-in-the-mainstream environmental groups.

Comfort Inn Opens, Logan's Roadhouse Sets Date

Marion's latest hotel Comfort Inn opened its doors to guests last month on July 20.

It's located at 2403 Black Diamond Drive behind Sao's Asian Bistro and McAlister's Deli on Morgan Avenue.

Although it sits back off the highway more than most of its competitors, its four stories overshadow the restaurants in front of it and so is visible even from the Illinois Route 13/Halfway Road intersection.

The new hotel has 64 rooms. It takes the place of the former Comfort Inn off of Exit 53. That is now a Quality Inn. Both brands are part of the Choice Hotels International family.

It's the second new hotel to open in Marion this year. A new Holiday Inn Express opened in May.

Down the street and round the bend construction work on Logan's Roadhouse is almost complete. The new restaurant is set to open Sept. 17, according to a sign out front.

The eatery will seat 180 guests which is a smaller model for the brand. In comparison O'Charley's in Marion sits 320.

It may be like Chili's in Carbondale which opened with a smaller venue and almost immediately added on to the facility.

Meanwhile work on the new Panera Bread store shows that it was almost in the dry when I took this photo last week. It should be fully enclosed by the time Hurricane Isaac's rains mark an official end of the drought this weekend.

It's located around the corner again from Logan's Roadhouse on the frontage road along Route 13 in between Drury Inn and America's Best Inns. Panera broke ground for the restaurant last month.

There are still at least two major chain restaurants looking at Marion not counting whatever is looking at the Millennium Development site - Boulder Creek at Marion. One of them is seriously looking at the land immediately north of Logan's. It's been listed as pending on the multiple listing service since earlier this year.

Irish Inn Owners Set to Retire

Today's Daily Register includes my story on the upcoming closing of the Irish Inn near Ozark in Pope County. Owners Brian and Lynne McCreery say it's time to retire after 12 years in the innkeeping business.

As I note in the story just in the last few years the inn has not only been named the "Small Business of the Year locally by the SIC Small Business Development Center in Harrisburg, but has received national recognition as among the Top 14 'Most Romantic,' the Top 10 'Fido Friendly,' and the 'Most International B&B in North America' to just name a few."

Lynne remains a strong supporter of tourism in the region and had good recommendations for those who want to go into the lodging business.

Check out the story for more.

Investors Target Area for Tourism Projects

Hardin County
Two cabins at Timber Ridge Outpost and Cabins opened Memorial Day weekend just off of Karbers Ridge Road a couple of miles away from Garden of the Gods.

Timber Ridge also opened one of their tree houses last week and a larger one now under construction should be finished by Sept. 1.

Elizabeth Canfarelli, one of the owners tells more about the idea for the tree houses.



Harrisburg
A video gaming parlor is being planned for the former Fox Cleaners location at the north end of Parker Plaza, according to shopping center's property manager. No application with the state has been filed yet. At least four other establishments have applied for video gaming licenses with the Illinois Gaming Board.

Marion
Logan's Roadhouse is wrapping up construction on Halfway Road around the road from a new Panera Bread and another restaurant is looking at the land immediately north of them. The Marion location will be the fourth in Illinois for Logan's.

Mr. Koolz Frozen Yogurt is coming to the former Stevens building on Williamson County Parkway across from Walmart and next door to Black Diamond Harley-Davidson. Rent One has purchased the building and is in the process of remodeling it.

Williamson County Commissioner Brent Gentry is opening the new establishment. According to the store's Facebook page, construction is under way and plans are to open next month in August.

Murphysboro
The Southern Illinoisan reported Monday that Martin Schaldemose, owner of the Old Train Depot is planning a major renovation of the historic structure in the 1700 block of West Walnut Street.

The owner said he hoped to begin major reconstruction in two months. He plans to knock out a southwest wall to make space for a larger kitchen. He also said he’s going to build an addition on the west side of the building to increase seating.

He would like to have a café with pastry and fine coffees during the day and transform the space into a “classy and cozy” restaurant with hints of French decorating at night.

A separate building south of the depot would be converted into an ice cream stand and bakery.

Oil Leasing Boom Boosting Mount Vernon Occupancy

According to oil and gas officials by way of a Southern Illinois lawmaker the flurry of oil and gas leasing in the east half of the region in preparation for a potentially massive oil boom has already boosted occupancy rates in Mount Vernon. Neighboring Wayne County and Hamilton County are the current hot spots for leasing after three companies started in Saline County last year.

State Rep. Brandon Phelps, D-Harrisburg, passed along the tidbit Thursday during the last day of the spring session in what was either the second or third interview of the day. A surprise move by a liberal college-town representative change an all-parties agreed upon fracking bill into one that would cause a two-year moratorium on the use of hydraulic fracturing, a technique that's been used for more than 60 years in Illinois.

Phelps and region's other lawmakers of both political persuasions blocked consideration of the bill and possibly saved hundreds if not thousands of potential jobs coming to the region. Fracking and horizontal drilling is expected to begin this summer. If they find oil in the New Albany Shale formation about a mile under the surface like they have in the Bakken formation up in North Dakota all bets are off for the region.

My story quotes Phelps as describing it as a potential $100 billion industry. I'm pretty sure that was with a "b" and not an "m" in the figures. Already oil and gas officials briefed lawmakers Thursday about the current impact of the potential boom.

Phelps noted that right now he was told, "(We) have 200 land men in Southern Illinois representing 10 companies. Hotel occupancies are up 20 percent in Mount Vernon alone."

My story from April talks more about the history of fracking in the region.

Southern Illinois lawmakers aren't the only ones who have been briefed about the potential for the region.

Even U.S. Senator Dick Durbin of Illinois who has been vocal in his support of new federal regulations targeting the use of coal expressed support for fracking during his visit to Harrisburg earlier [in April].

"You know we're going to ask all the right questions because there are legitimate concerns, but we've found it can be done safely if it is carefully regulated. We don't want in any way to contaminate water supplies in the process. We don't want to put anyone's public health in danger. We just want it done in a thoughtful careful manner that will call for some government oversight and regulation to make it work," Durbin explained.

...the Democratic senator would rather see the regulations take place at the federal level...

"If it can be done in that way it's a source of energy that we never dreamed of that's just sitting there waiting to be tapped," said Durbin who remained coy at giving an exact value to its potential, only pointing to the oil boom taking place in the Bakkan shale formation in North Dakota...

So how big is the Bakken boom? Well, first, Mount Vernon's higher occupancy rates may only be the beginning.

Williston, N.D., is the center of the new oil boom. KPAX-TV reported May 8 that Williston saw 10 hotels open last year with six or seven ready to open later his summer. At one point the Holiday Inn was charging $250 a night.

When I wrote my story quoting Durbin, North Dakota was the nation's third-largest oil-producing state. Since then on May 15, the Wall Street Journal reported North Dakota has now surpassed Alaska as the nation's second largest oil-producing state. Only Texas produces more oil.

Belleville Pursues Hotel on Illinois Route 15

The Belleville News-Democrat has a story this afternoon about their mayor's desire for a new hotel on the city's west side at Belleville Crossing.

BELLEVILLE -- Mayor Mark Eckert has said for the past several years that the sour economy has kept development at bay, but he thinks the time may be right to tackle new ventures again.

He and The DESCO Group, the developer of Belleville Crossing on Illinois 15, are talking about the possibility of a hotel in that area. He said the two parties agree that, with the economy bouncing back, the area is ripe for opportunity.

"I'm asked all the time: Why aren't we going after a hotel?" Eckert said. "It is time to start to pursue this again."

The story notes a developer backed out after the recession started in 2007 who wanted to build a Hampton Inn.

There's hope yet for Belleville. Marion's two newest hotels, the new Holiday Inn Express & Suites and the Comfort Inn now under construction were both 2007 projects that were sidelined by the recession but have since made a comeback.

The challenge for Belleville is that the location is in the opposite direction of the interstate highways.

Holiday Inn Express Opens in Marion

The new Holiday Inn Express & Suites opened on The Hill in Marion May 6 just in time for the busy SIU-C graduation weekend. Stephen Rickerl has the story in the Southern which focuses on more about the The Hill's growth itself.

The opening of the new hotel adds 101 rooms for Marion. The former Holiday Inn Express off of Exit 53 is now Best Western Plus Marion Hotel. Meanwhile progress continues on a new Comfort Inn which will add 64 rooms.

The new room count should be around 1273 for Marion and 1411 overall for Williamson County, however it's possible another 50 or so rooms will disappear in the next year as developers eye America's Best Inns for new restaurants. Additional rooms may be lost at another older hotel if the owners go through with a renovation to combine rooms and create new suites.

In another name change, the original Ramada Inn and most recently a Days Inn, switched flags and is now an American's Best Value Inn.

Harrisburg Targets TIFs for Growth

View Proposed Harrisburg TIF Districts in a larger map

The City of Harrisburg is looking to aggressively use tax increment financing districts (TIFs) to not rebuild following the devastating Feb. 29 tornado but also growth their economy with new developments along Illinois Route 13 Bypass which recently opened up completely.

I've got a story in today Daily Register about the background on the plans. Mayor Eric Gregg indicated following their city council meeting tonight that council will take up the TIFs at a special meeting on Monday, April 30.

They already set a continued meeting for that morning at 8 a.m. to pass a budget before the beginning of the city's new fiscal year in May. The special meeting will likely immediately follow.

The city's already working with lawmakers to get their 22-year-old TIF I an extension for another 12 years. A proposed TIF II would run along the new bypass, named the Bill Franks Way. TIF III would cover the area on the south side of the city hit by the tornado.

There's no specific tourism component in these TIF plans, but the city's two modern hotels, the Super 8 and Comfort Inn were both built within TIF I during its early years. The Saline County Tourism Board and some of those interested in TIF II have long sought a new higher end lodging establishment.

Most of the commercial development, both retail and hospitality are mostly located along U.S. Route 45 on the city's east side. The new bypass offers potential of a new east-west business corridor creating a 7-shaped business district.

Saline County Commissioners apparently endorsed the extension of TIF I Tuesday night at a special meeting where they approved an option to purchase nine acres of county property along the north side of the bypass for a major new residential project. It lays in both TIF I as well as the portion of the first TIF that is being added to the new TIF II.

The city needs the written support of the major taxing bodies by the end of next week so state Sen. Gary Forby, D-Benton, and state Rep. Brandon Phelps, D-Harrisburg, and attached language to an existing TIF bill to extend the life of TIF I. The end of the spring legislation session is quickly approaching in May.

The next step for TIF II is a city council vote approving the feasibility study. For TIF III they need to officially hire the TIF consultant and begin the work on third TIF.

Marion Doubles Hotel Bed Tax

The Marion City Council approved a measure Monday night that would double the city's bed tax adding a 5 percent hotel "use" tax to the existing 5 percent hotel "occupation" tax.

The new 10 percent local tax compares with Carbondale's 8 percent rate and Mount Vernon's 5 percent plus $2/night rates. Adding the state's 6 percent rate, tourists in Marion would pay an overall rate of 16 percent.

The Southern reports that the funds would help the city pay for a new community center and other projects.

Chester Gives New Motel OK For TIF

The proposed Microtel motel project in Chester will move forward with the city's help following a 5-4 vote last night by the city council.

The Southern Illinoisan has the story.

Mayor Joe Eggemeyer cast the deciding vote after the council split 4-4. The vote was just to start negotiations with the developers over the use of TIF funds. If an agreement is reached the council will hold another vote.

Project partners James Best of Chester, John Bergfeld of Sparta and John Pawloski of Godfrey are proposing to build a $6.5 million, 60- to 85-room hotel development at the site of the old Hi-3 motel, which has been closed for about 20 years.

Chester currently has one hotel, Reid's Best Western Inn, owned by Brad Reid, also the owner of Reid's Harvest House.

If an agreement is reached, the paper noted that the developers are eligible to be reimbursed for up to 75 percent of the new property taxes generated from their improvements.

Illinois law doesn't allow TIF funds to be used for new construction, but costs associated with the property acquisition, demolition of the old motel, site preparations and dirt work would be eligible expenses.

Chester Struggles With New Hotel Decision

View Larger Map
To build or to block — that's the question for the Chester City Council.

Developers James Best of Chester, John Bergfeld of Sparta and John Pawloski of Godfrey have proposed a project to build a $6.7 million 65 to 80-unit Microtel hotel on the highway above the Chester Mental Health Center and the Menard Correctional Center. The project would replace the shuttered post-World War II motel, the Hi-3, that's now closed.

To cover part of the redevelopment costs they want to use funds from future property tax payments to the city's existing TIF district.

The problem rests with the owner of the one remaining hotel, the Reid's Inn Best Western, who says there's no room for two in town, and that the city shouldn't be financing his competition.

The city went as far as hiring an expert to conduct a study. The expert though was a property appraiser out of the St. Louis market. That's a problem, the developers imply - he's not really an expert in their field.

The Randolph County Herald-Tribune has his complete report online.

As the council debates the issue they should consider two items not in the report.

First, do they really want to protect what appears to a 40-year-old ex-Ramada Inn now affiliated with Best Western over a brand new property?

In Mount Vernon, the former Ramada became a Best Western and is now shuttered. There's a reason for that, modern travelers not driven by the price will avoid those properties like the plague.

The report states that most of the furnishings in the existing Best Western are less than two years old. That may be true, but it still looks like an old Ramada Inn on the front.

That's not to say it isn't well run. Reviews at TripAdvisor.com are generally positive and complimentary.

Second, if the Chester city fathers would look to Marion they would see that the last seven hotels (and the two now under construction) have all benefited either directly or indirectly from tax increment financing.

Up the interstate, Mount Vernon has created a new TIF district alongside it's new interchange. Presumably any future hotels that locate there will benefit to some extent from those efforts.

City leaders create TIF districts when they determine that blighted conditions are hurting their communities. Lines are drawn, then any development that takes place within those lines become eligible for tax increment financing.

A TIF agreement has to be reached between the developers and the city, but unless the proposed development is a public nuisance or will hurt the community in the long run, it's really not the city's business to start making value judgments.

To me, the difference between venture socialism (like Solyndra and GM) and the use of general tax incentives is the amount of government interference and political posturing that takes place.

Incentive programs like TIFs possess a clear-cut set of rules. If the developer meets the objectives, then they qualify for the incentives. The decision to offer the incentives has already been made when the city established the TIF district in the first place.

The local owner of the Best Western argues that it's not the city's role to pick winners and losers. He's right. It's not the city's role to block competition in the marketplace.

Another thing. The study rightly points out that both Chester and Randolph County lost population during the first decade of the 21st Century. The Southern Illinoisan pointed out that the site in question has been a closed motel for 20 years.

The Chester city council was right in taking steps to revitalize their community by creating a TIF district, but if they balk at local investors wanting to redevelop blighted eyesores, I'm not sure where they're going to grow.

Herrin Innkeeper Ann Hindman Dies

A former co-worker at the Williamson County Tourism Bureau just contacted me that Ann Hindman, proprietor of the Park Avenue Motel in Herrin died this morning.

Hindman and her late husband and Herrin contractor Paul Hindman had opened the motel back in the early 1960s. I served with her on the Williamson County Tourism Bureau board of directors twice, and then later as executive director of the bureau. I could always count on her to speak her mind if she felt the need, which I appreciated.

She and her husband broke ground for the Park Avenue at the beginning of August 1960.

"Construction will be concrete and fireproof throughout," [Paul] Hindman [told the Southern Illinoisan at the time].

Concrete slabs will form the room and Anna stone and aluminum decorative screens will be used on the walls. Each room will be 12 by 20 feet. The portion near the entrance will house a coffee bar, office, lounge and meeting room.

Rainy weather delayed construction as her husband worked to fit it into his schedule of other work. Finally, after months of delays, the Hindmans opened the motel on April 15, 1962.

A full-page ad from July 17 that year told tourists what they could expect.

The PARK AVENUE MOTEL is a new concept in downtown motel convenience. Mr. and Mrs. Paul Hindman, owners, believe in making every guest as comfortable as possible. In each of the 20 units are automatic telephones, electric heating and air conditioning, television, wall-to-wall carpeting, tile bath and showers. And something special ... courtesy coffee located in each unit! Truly, this is comfortable living.

Stop by the PARK AVENUE MOTEL the next time you’re in Herrin. Paul and Anna Hindman will be glad to show you how staying at the PARK AVENUE MOTEL will leave you rested and refreshed.

Located at 912 North Park Avenue, Phone WIlson 2-3159.

Mrs. Hindman was pretty particular who she let stay at her place. If you looked rough or ratty, she wouldn't hestitate to send you packing.

At least up to the last few years she cleaned the rooms herself. To make a telephone call, she would have to personally make the connection on the old-fashioned telephone operating board in the office.

Over the last few years I would get updates every once in a while about her condition as she struggled with some ailments. She will be missed. She was a Herrin institution.

Her husband Paul died Nov. 2, 2000, at the age of 77.

Funeral arragements are pending at Johnson-Hughes Funeral Home in Herrin.

Hotel Receipts Up in Region for FY11

The good news is hotel bed tax receipts were up for the 12 months ending in June 2011. The bad news, it's extremely difficult to match the state figures with local bed tax receipts. That shouldn't be the case (more on that later), but now the numbers.

After many areas took a battering last year in lodging revenues, most counties in Southern Illinois saw an increase in FY 2011.

Overall, the Illinois Department of Revenue reported that the state saw a 3.3 percent overall increase in bed tax collections throughout the 17-county region from Mount Vernon south (at least in the 11 counties where they broke out figures; data wasn't available for the other six). Area lodging operators collected more than $3.1 million for the state's 6 percent bed tax from travelers in the region.

For the last couple of decades Mount Vernon and Marion have boasted the most hotel rooms along with interstate interchanges, but for the last two years Williamson County has surprassed Jefferson County in taxable hotel revenues.

Jefferson County lodging operators brought in more than $13.5 million during the 12 month period compared to Williamson County's $13.9 million. Both counties saw revenues just 7.3 to 7.4 percent.

Jackson County saw revenues go up 1.6 percent to $8.7 million. Massac County also saw a small increase of just 1.2 percent to $4.35 million, but river flooding is also partly to blame with two of Metropolis' major properties closed at times this spring due to the high water, (one of which was still closed for remodeling as of a few weeks ago).

Franklin County comes in fifth with $2.9 million in hotel revenues, down 10.6 percent during the year, and down 16.9 percent compared with two years earlier.

Randolph County with hotels in Chester and Sparta saw a 10.5 percent drop in revenues last year, down to $2.5 million, but they're still up 7.8 percent over the last two years.

Union County rounds out the top seven counties with its establishments reporting just under $1.6 million in revenue. They were down three-tenths of a percent compared with the year before. Unlike its larger competitors, Union County sees most of its revenues come from smaller specialty properties of cabin rentals and B&Bs rather than hotels and motels.

In reality, Union County's lodging operators actually played a bigger role, as the state counts establishments by their zip codes rather than their actual location. Thus all of the places with Makanda zip codes including Giant City Lodge, are included in Jackson County's totals.

Likewise Williamson County loses three cabins with a Carbondale zip code to Jackson County, but picks up two at the Lake of Egypt with a Creal Springs zip code that are actually in Johnson County.

Elsehwere Saline County experienced a 13.1 percent increase with hotel revenue up to nearly $1.3 million. Perry County hotels followed with nearly $1.2 million, pretty much the same as the year before.

White County with most of its lodging on its north side at Grayville and Interstate 64 reported $1.1 million in hotel revenue.

Hardin County lodging operators reported $356,000 in revenue down 2.1 percent from the year before while Pope County saw a 35.9 percent increase in revenues reported though from a smaller base. Their operators reported $262,000 in room rentals.

No figures were made available for the industry in Alexander, Gallatin, Hamilton, Johnson and Pulaski counties (as well as White County for previous years). The state doesn't release county level information if there are fewer than four lodging establishments paying state taxes.

Another problem is that even when the zip code issue is taken into account, the state's still four or five establishments short in Williamson County alone. Either some folks aren't paying the state taxes, but should, or there's yet another issue with the Department of Revenue's procedures.

The difference between the state and county's figures in Williamson County is more than a vacation rental, or an outdated motel or two that's more residential than tourist any more. It's the equivalent of one or two of the largest hotels not paying.

I'm beginning to wonder if the state is counting the location of the hotel management company and where they write the monthly check rather than the actual location of the hotel. All the Department of Revenue is concerned about is, well, the revenue.

The problem is that the Williamson County Tourism Bureau may be getting shortchanged in state funding, just as Carbondale benefits and Southernmost Illinois Tourism loses when Giant City Lodge and all the other Makanda-addressed facilities on the Union side of the county line get counted in Jackson. Except in Williamson County's case the figures may be more significant.

Local certified convention and tourism bureaus are funded by local bed tax collections as well as a state Local Convention and Tourism Bureau (LCTB) grant. The General Assembly appropriates the overall amount for the LCTB grants and the Illinois Bureau of Tourism uses a formula to distribute the funds proportionally among the various bureaus. The formula is based on three components; the state's bed tax collections from the bureau's service area being the biggest component, with restaurant sales tax collections being the second biggest factor.

The problem? IBOT gets the figures for their formulas from the Illinois Department of Revenue.

That's a mystery I don't have time to unravel right now, but at least we can focus on the positive: More people are spending more money in Southern Illinois than they did the year before.

New Hotels to Add 165 Rooms in Marion

The addition of a new Holiday Inn Express with 101 rooms and a new Comfort Inn with 64 rooms will take Marion's room count from 1108 to 1273, when both projects are open by early 2012. Williamson County's count will grow from 1246 to 1411.

The top seven hotels in Marion have averaged around 78 percent of the motel tax receipts over the past five years. The seven are Comfort Suites, Country Inn & Suites, Drury Inn, Fairfield Inn, Hampton Inn, Holiday Inn Express (soon to change to another flag when the new hotel opens), and Quality Inn. When they open the Big 7 will become the Big 9.

The other motels in the city generate about 6 percent of the overall bed taxes. That leaves the remaining lodging establishments outside the city limits making up about 15 percent.

To put it in perspective, all the lodging establishments in the county generated roughly $700,000 in the 5 percent bed tax levied in calendar year 2010. Forty percent, or about $280,000 went to the Williamson County Tourism Bureau and 60 percent, or about $420,000 went to the Williamson County Events Commission to pay debt service and mandatory reserves on the Williamson County Pavilion.

Since then the city has taken over the Pavilion and levied a 3 percent bed tax on city hotels that preempts the county's 3 percent bed tax for the Pavilion within the city limits. The city issued new bonds to take the place of the outstanding debt. The biggest difference in terms of operational benefit is that any excess bed tax collected by the 3 percent city tax can be used by the city for operations. Under the original bonds, the excess funds went into a separate Bed Tax Savings Account that couldn't be touched short of a major disaster.

The Big 7 hotels have 640 rooms. Adding another 165 is a 25 percent increase. If the new hotels can add to the market rather than just eating into the existing hotels' market share (and that's what their competitors are hoping), then that could be a big kick of revenue for the tourism bureau and the Pavilion.

A 25 percent increase of the Big 7's 85 percent of the market using 2010 figures comes to just under another $60,000 for the bureau and almost another $90,000 for the Pavilion.

Being realistic the figures might be half that amount with the shaky economy. However historically bed tax revenues were up nearly 50 percent between 2010 and 2000 in Williamson County.

Even better, the larger hotels in Marion often employ far more employees than most people realize as they have to remain open 24 hours a day, seven days a week. Other than the management positions, it's not the highest paying jobs in town, but in this economy, every job counts! 
 
Looking Back — 2000 to 2010

The county started the 21st Century with 1303 rooms. The county lost 200 when the old Holiday Inn/Travelodge/Executive Inn finally shut its doors in 2004, and another 53 rooms or so when Jim Zeller bought the back wing of America's Best Inns and tore it down for the new Country Inn and Suites in 2008. Another 20 rooms at SIU Touch of Nature aren't counted any more when the university decided it was no longer going to collect bed tax back in 2007.

Meanwhile Lake Tree Inn & Suites opened in 2000 with 20 rooms, Fairfield Inn opened in 2004 with 89 rooms, Hampton Inn expanded mid decade with another 20 rooms, and Country Inn & Suites opened in December 2008 with 69 rooms.

The decade also saw the expansion of the specialty lodging market. Olde Squat Inn already had 5 cabins and added two more. Devil's Kitchen Cabins opened with two cabins in 2006 and are now up to three. The Four Seasons Campground in Herrin added two cabins in 2006, though in recent years they've been turned into apartments.

The first traditional bed and breakfast inn, Oakridge Manor B & B opened in 2004 with four rooms and they've since added a fifth. Mary's Bed and Breakfast in Herrin opened in 2008 with two rooms and Jasones Bed and Breakfast in Marion opened with five rooms in 2010.

The county also saw its first legal vacation rental, the Carriage House open down at the Lake of Egypt in 2008. Regrettably, there are at least two more on the north side of the county line down at the lake that aren't legal having failed to pay the county any bed tax.

Overall specialty lodging has gone from 1/10th of one percent to about 1.3 percent of the market in the last decade.

A Missed Opportunity

Regrettably in August the county board voted to eliminate the county's 3 percent bed tax after the city took over the Pavilion. Far from being next to nothing, the county threw away about $63,000 in economic development funds that could have been spent on brick and mortar tourism development projects in the county. The tax affected 10 properties, including two modern motels, four older motels, two properties with 10 cabins, two bed and breakfast inns and one vacation rental.

Potential development projects could have included a system of tourism highway signage on county highways and roads to compliment what's already on the state highway system, interpretive signage at county historic sites, capital funding for repairs to public and non-profit tourism sites, capital funding for the proposed tourist information center next to the chamber office, engineering costs for development of bike trails connecting to the Tunnel Hill State Trail, or proposed bike trails in Crab Orchard National Wildlife Refuge, and matching funds for larger state and federal development grants.

The 3 percent county bed tax had been added to pay for the Pavilion, a big capital project that was originally proposed to help tourism development. When the city took that over, the money should have been moved to something similar. Although the bed tax is collected by local lodging operators it's paid by out-of-town visitors. Lowering the bed tax rate doesn't attract any more visitors to the area, it just throws away thousands of dollars that would have been coming to the county but now won't.